Uber will spend $100M to build AV charging hubs in the US
Uber Technologies (UBER) said on Wednesday that it will spend more than $100 million to build autonomous-vehicle charging hubs in the United States as it tries to keep pace in the highly competitive robotaxi market.
The company said in a statement that it will begin building the AV hubs in the San Francisco Bay Area, Los Angeles and Dallas.
Uber will be partnering with EVgo Inc. (EVGO), one of the country's largest providers of public fast charging infrastructure for electric vehicles (EVs).
As part of its capital project, Uber will also be opening DC fast-charging "pit-stops" for robotaxis throughout various major cities in the US. It will also open charging-equipped depots in other cities as it continues to expand its autonomous operations.
Uber will be offering "utilization guarantee agreements" with EVgo in New York, San Francisco, Los Angeles and Boston that ensures a minimum usage for EVgo's charging networks in exchange for a discount on charging for Uber drivers.
The company is offering a similar guarantee to Elektra's network in Paris and Madrid and Hubber's and Ionity's in London.
The $100 million investment is meant to offset the costs of building new charging stations for companies like EVgo, who spend upwards of $100,000 to build a single station.
Uber said that owning AV chargers "improves efficiency, lowers costs and keeps vehicles on the road longer, maximizing utilization and uptime.”
"Cities can only unlock the full promise of autonomy and electrification if the right charging infrastructure is built for scale,” Pradeep Parameswaran, global head of mobility at Uber, said in a statement. “That infrastructure needs to work for today's drivers and the fleets of the future."
Uber currently offers robotaxi services in four US cities - Phoenix, Austin, Atlanta and Dallas - and has also partnered with Chinese startup WeRide (WRD) to launch robotaxi service in Dubai. Its robotaxi service in Austin and Atlanta is being offered through a partnership with Alphabet's (GOOG) Waymo.
And in January, Lucid Group, Inc. (LCID) unveiled a new robotaxi that it has designed with Uber at the Consumer Electronics Show (CES) in Las Vegas.
In a press release announcing the robotaxi, Lucid noted that on-road testing began December, putting it on pace to launch in the San Francisco Bay Area later this year.
Uber has been facing pressure from Wall Street as robotaxis are seen as a growing threat to its core ride-hailing business, especially from Waymo. Tesla (TSLA) is also seen as a looming threat, but thus far the company's robotaxi ambitions have been more hype than reality.
Waymo currently offers robotaxis in the San Francisco Bay Area, Phoenix, Los Angeles, Atlanta, Austin and Miami. And it's planning a massive expansion in the US this year, looking to launch the service in Houston, Dallas, Denver, Detroit, Las Vegas, Orlando, Nashville, San Antonio, San Diego and Washington, D.C.
Uber's stock has fallen nearly 11% so far this year, but gained 3.2% on Wednesday.
In a client note on Wednesday, Guggenheim analyst Taylor Manley noted that the slump in share price is "primarily driven by AV competition-related sentiment."
Nonetheless, he maintained a Buy rating and said because of the drop in share price, "we view risk/reward as increasingly attractive" for investors because of "long-term top-line growth durability."